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BIOECONOMY – the Growth Engine of Nordic Regions?

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BIOECONOMY – the Growth Engine of Nordic Regions? NORDREGIO POLICY BRIEF 2015:5 • PUBLISHED JUNE 2015 PHOTO: YADID LEVY / NORDEN.ORG Cases from Nordic countries » Policy recommendations » BIOECONOMY – the Growth Engine of Nordic Regions? Why this buzz about bioeconomy, you might wonder? fossil fuels with biofuels and replacing non-degradable Perhaps because it can be seen as a “silver bullet”, able products with bio-degradable ones. Second, the bioeco- to avert several staggering threats to our societies: eco- nomy could boost the productivity and product develop- nomic and demographic decline in rural areas; jobless- ment within agriculture, fisheries, forestry and the che- ness and the climate crises. Clearly, there are several mical industry. Finally, the bioeconomy creates new jobs good reasons for the Nordic countries to dig deeper into in sparsely populated areas, by utilizing existing natural their bountiful biological assets. First, it is about replacing resources in new ways. the nordic region contains a multi- Since 2014 bioeconomy has been high the total Nordic economy. tude of biotic natural resources; from the on the Nordic policy agenda. The total The share of the economy represented marine environments off the Icelandic turnover of the key bioeconomy sectors in by the bioeconomy is highest in Iceland and Norwegian coasts to the vast forests the Nordic countries was approximately and lowest in Norway. In the Nordic region, of Finland and Sweden and the fertile ag- €184,000M in 2014 according to Nordic growth potential is found in a wide range of ricultural soils in Denmark. Innovation (2014). This constitutes 10% of bio-based products such as chemicals, bio- » www.nordregio.se ISSN 2001-3876 NORDREGIO 1 » fuels and gas, nutrients and medicine. There are differences in the extent Box 1. Defining bioconomy to which the bioeconomy is prioritized International actors and governments have different ways of defining bioec- on the national political agenda. So far, onomy. The aim is clear though: to develop an economy that is based on the Denmark, Finland and Iceland are the sustainable utilization of renewable resources. In its “Communication on In- forerunners in this regard. Finland and novation for Sustainable Growth: A Bioeconomy in Europe”, the EU considers the bioeconomy to consist of food, agriculture, paper and pulp, forestry and Denmark recently launched new national wood industry, fisheries and aquaculture, bio-based industries, biochemicals policies and strategies to promote bioeco- and plastics, enzymes and biofuel sectors. In policy-making, a bioeconomy is nomy. in many cases also seen as requiring a cross-sectoral approach that calls for a In the following pages we present five broad range of system-level changes and innovation. Nordic cases of bioeconomy at work – and the impeding and enabling factors. NORDIC CASE STUDIES ICELAND – South Iceland region “Bioeconomy in a sparsely populated region – without always calling it bioeconomy” Enabling conditions Impeding factors n The region is a major producer of agri- n Scarce population, lack of educated cultural products and fisheries. Tourism workforce, vulnerable for out-migration creates new markets. n Small companies, small innovations. n Considerable potential: competences Companies require external encourage- and knowledge of primary food produc- ment. tion n The regional structure makes it diffi- ICELAND ! n National level: Matís Ltd, an Icelandic cult to create joint strategies but the policy South Iceland region food and biotech R&D organisation, pro- framework in Iceland is being reformed moting region´s food innovations n Ecoinnovation is included in the na- n A specialized national funding instru- tional strategy Iceland 2020, but imple- ment was created to increase the value of mentation has been slow due to govern- Indicative maps of the case studies on food and non-food marine products. ment changes this spread: Nordregio / Julien Grunfelder DENMARK - Lolland region “Green economy focus & bioeconomy initiatives in a region undergoing restructuring“ Enabling conditions Impeding factors n Long tradition of renewable energy n Structural challenges of industrial de- production and active local community velopment, out-migration, dependence n Vestas Wind Systems, a world leading on local labour markets manufacturer in the wind energy sector n Location disadvantages: weak urban ! DENMARK Lolland region n Green Center was created in 1988 in networks and infrastructure; difficulty Lolland to help farmers innovate in connecting with neighbouring regions n A regional development strategy that n Low density: difficult and expensive places renewable energy as a core priority implementation of strategies that would ! and catalyst for other developments improve the efficient use of resources n Denmark aims to become completely (water, energy) ! energy independent by specializing in n Renewable energy sectors’ continued clean technologies. One objective is to dependence on public subsidies. Farm- utilize 50% of the manure for biogas. ers don’t find it profitable to harvest bio- n A European Strategy for Sustainable, mass for biogas. Competitive and Secure Energy 2020 (EU policy 2006) has been accompanied by fi- nancial support to regions like Lolland. www.nordregio.se ISSN 2001-3876 NORDREGIO 2 NORWAY – Østfold region “Region with a locomotive bioeconomy company” Enabling conditions n The knowledge base & reputation cre- ated by the world class biorefinery Bor- regaard n National Strategy for Biotechnology 2011-2020: investment in research, de- velopment and the commercialization of biotechnology n Public support system as an additional asset: Industrial Biotech Network Nor- way SWEDEN Örnsköldsvik n The Research Council of Norway fo- cuses on the bioeconomy through the Re- search Programme BIONÆR on Sustain- able Innovation in Food and Bio-based Industries 2012-2021 n White Paper No. 7 (2008–2009) “An innovative and FINLAND Sustainable Norway” Forssa sub-region Impeding factors NORWAY n The competitive situation in Østfold region Norway between fossil fuels and biomass - low profitability n Decline in the number of jobs in FINLAND - Forssa sub-region the region, especially related to “Bioeconomy with regional branding and management and academic professions public-private initiatives“ n High costs in Norway make it difficult to compete in the global market Enabling conditions n Limited access to raw materials n Tradition of agriculture, industry and applied education in the region n Cluster of several research institutions, cleantech companies and educational insti- SWEDEN – Örnsköldsvik tutions related to bioeconomy “Long-term commitment towards regional bioeconomy cluster” n The Finnish National Strategy on Bioec- onomy (2014). “Pioneer of the global bio- Enabling conditions economy” n Örnsköldsvik region has a long tradi- n Regional large-scale biorefinery initia- tion in forestry, trade and heavy industry tive: Brightgreen Forssa program (2014) n Access to natural resources, primarily n The Envi Grow Park eco-industrial park wood as a flagship for Forssa bioeconomy (closed n Public-private co-operation and long- circulation of energy and materials ) term financial commitment Impeding factors n Active public-private cooperation n The Örnsköldsvik Biorefinery of the n Political will for change is partly lack- n National & international networking Future Cluster: >20 member companies, ing. Action is requested to correct market using biotech to create new products failures by e.g. inserting tax incentives Impeding factors n National level: Swedish Research and and biofuel quotas. n Old mindset: “smokestack industry” Innovation Strategy for a Bio-based n The national bioeconomy policy has n Shortage of qualified labour Economy: because of good natural geo- not been updated recently n Weakened regional and local financing graphic conditions, industry and infra- n Hesitant regional mindset due to some of bioeconomy initiatives structure, Sweden has good conditions failed bioeconomy investments in the past n Need for additional high-growth com- for conversion to a bio-based economy nThe technologies are ready to scale-up, panies to form a critical mass for the n Steadily increasing share of biofuels in but the demand for green solutions is in- Forssa regional bioeconomy cluster, and transportation and heating sufficient to provide inspirational examples www.nordregio.se ISSN 2001-3876 NORDREGIO 3 POLICY RECOMMENDATIONS - national and regional level The five Nordic case studies can be summa- n Focus on export promotion and the n Ensure long-term national and re- rized as a common call for action and true glocal nature of bioeconomy: Open-up a gional, political and financial support in implementation of national and regional new export markets for bio-based prod- developing regional bioeconomy sectors bioeconomy strategies. The following mes- ucts and services – through Nordic coop- or industries, including up-scaling of sages were put forward to decision-makers: eration, elimination of border obstacles demonstration plants to larger facilities. and other EU-initiatives. See e.g. VINNOVA’s support to the biore- n Create a common understanding of finery in Örnsköldsvik, Sweden. the concept bioeconomy. This has an n Promote regional co-operation and impact on ambitions, visions, tools, and pooling of resources between regional n Supply statistics: Make it easier to learning between countries and regions. and local sectors and actors, through monitor the actual impact of bioeconomy Interesting initiatives
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